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Crypto exchange Sushiswap receives SEC subpoena

Crypto exchange Sushiswap receives SEC subpoena

The Securities and Exchange Commission has served a subpoena on the Sushi DAO and its Head Chef Jared Grey.

SEC after a DEX scalp

The SEC is continuing its enforcement push on crypto, targeting some of the more important infrastructure in the crypto ecosystem. Crypto exchanges are certainly that, and decentralised exchanges (DEXes) are likely to be far more difficult for the SEC to attack than centralised exchanges (CEXes) 

However, the SEC has obviously decided that it has a good chance to score an enforcement victory here, and if successful may use the case for further DEX enforcements in the future.

Sushi DAO votes on defence fund

Sushiswap has now become a decentralised autonomous organisation (DAO) and so all important matters are decided by a community vote. Therefore a vote has gone up on the Sushi forum, with the goal of establishing a legal defence fund. If approved this will enable core contributors (who the SEC are going after) to be able to cover their legal expenses.

The Sushi DAO Legal Defence Fund aims to provide reasonable expenses for attorney fees and costs, and the voting proposition recommends that the value of $3 million be made available to this end.

The proposition lays out that the funds should come from a combination of 3 areas. These are Kanpai fees (50%), grants (35%), and Sushi TWAP market sells (15%).

As at time of going to press, the vote has been in operation just one hour and only 15 respondents have voted, giving a 93% in favour of the fund so far.

A troubled past

Sushiswap is a spin-off from Uniswap, but after initial success it has now dropped to become the 16th biggest DEX by trading volume according to Coinmarketcap.

It has had its problems in the past, with its creator and former Head Chef Nomi draining more than $14 million in $ETH from the protocol. However, he later thought better of his act and returned all the funds to the Sushi treasury. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.